Data envelopment analysis for decision-making units: a comparison of the relative efficiency of banks in the Kingdom of Bahrain
Minwir M. Al-Shammari and
Mohamed Sayed Abou Elseoud
International Journal of Economics and Business Research, 2024, vol. 27, issue 2, 216-235
Abstract:
The study aims to measure and compare the relative efficiency of conventional retail and Islamic banks in the Kingdom of Bahrain over the period 2017-2019. The study adopts the input input-oriented CCR and BCC models of data envelopment analysis to compute both the aggregate efficiency scores of each banks group and the efficiency score of each bank. The sample of banks includes six conventional banks and six Islamic banks. At the same time, the selected inputs are total deposits, fixed assets, and owner's equity, whereas outputs are credits facilities, total operating income, and net profit. The main findings show that both banks' groups are efficient during the study period. At the level of individual banks, the conventional retail banks are more efficient than the IRBs in 2017 and 2019, while there are no significant differences between the efficiency in 2018. Finally, the study identified input and output slacks of inefficient banks, and it suggested the efficient input and output targets for improvements.
Keywords: Islamic banks; conventional banks; data envelopment analysis; DEA; CCR; BBC; relative efficiency; comparative efficiency; Bahrain. (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:ids:ijecbr:v:27:y:2024:i:2:p:216-235
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